updated 06:10 pm EDT, Fri October 15, 2010

Apple TV ads still unclear

Apple is reportedly preparing to expand its iAd platform to serve ads within video streams on the iPhone, iPod touch and iPad. The advertising platform may also be adapted for compatibility with Apple TV, which also runs a specialized version of iOS, sources have toldGigaOM.

Recent reports suggest some advertisers have dropped out of the program, which has experienced slower-than-expected growth. Apple has been criticized for maintaining tight control over content and pushing advertisers away, although the company is still expected to reach 21 percent of the mobile advertising share by the end of the year.

The iAd expansion is also seen as a way to make iOS devices more attractive for video content providers. Apple's advertising platform is said to work with both Quicktime- and HTML5-based videos, allowing publishers to mimic the advertising strategies currently employed with Flash players. Video publishers would be able to integrate their own ads, or allow Apple to use its own ad network.

One source suggests the video iAds will be formally introduced in the first or second quarter of the year. Apple has yet to officially confirm such plans.